According to the latest docket posted, on May 5, 1999, the plaintiffs filed a Second Amended Consolidated Complaint. On July 20, 1999, the Court entered the memo endorsed transcript of proceedings before U.S. District Judge Loretta A. Preska on June 9, 1999. Judge Preska dismissed the amended complaint for substantially the reasons set forth in the decision on the original complaint. The case is closed.
By the closing Order, dated 04/09/1999 from U.S. District Judge Loretta A. Preska of the United States District Court for the Southern District of New York, defendants moved under Fed. R. Civ. P. 12(b)(6) to dismiss plaintiffs' suit for failure to state a claim. The district court granted defendant corporations' motion to dismiss plaintiffs' securities fraud suit for failure to state a claim. The court held that although plaintiffs' complaint accurately pleaded the time, place, speaker, and content of the statements plaintiffs alleged were false, the complaint did not include particularized facts indicating that the statements were false and that defendants acted with fraudulent intent. Plaintiffs may replead their claims within ten days of this Order.
The original complaint charges Ronald O. Perelman ("Perelman") and certain Perelman - related entities with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by, among other things, making materially false and misleading misrepresentations and omissions concerning a contemplated financial restructuring of Marvel by Perelman and certain Perelman-related entities.
Specifically, the complaint alleges that, at all relevant times, defendants
misrepresented and failed to disclose that they had a pre-determined plan
whereby Perelman would cause Marvel, which he controlled, to issue to
affiliated entities hundreds of millions of newly-issued shares of Marvel
common stock on highly preferential terms, thereby severely diluting Class
members' interest in the Company and preserving Perelman's ownership and
control of 80% of Marvel's outstanding equity. That undisclosed plan and
scheme directly contradicted statements by defendants during the Class Period
in which they had promised or implied that Marvel would be financially
restructured on terms that would be generally beneficial to its investors.
The class consists of all persons who purchased or otherwise
acquired certain bonds secured by the stock of Marvel Entertainment Group,
Inc. ("Marvel" or the "Company"), during the time period from Oct. 8, 1996
through Nov. 12, 1996, inclusive, (the "Class Period"), seeking to pursue
remedies under the federal securities laws.
NOTE: According to a docket dated May 10, 1999 (posted below), this case was first filed in the Northern Alabama (docket number: 97-cv-01895 - Loretta A. Preska), and then transferred to the U.S. District Court Southern District of New York.